Short Sale or Rent My Home- Running Out of Options

I’m trying to decide whether to rent out my home or do a short sale in Phoenix.

My numbers: • Owe: $408k • Realtor estimate: $406k • Based on the market, I think my home is worth $410–$420k max • Payment (PITI): $2,927 @ 5.125% • Local rents: $2,200–$2,300 (I’d be negative ~$600–$700/mo) • Home: 2018 build, ~2,000 sq ft

Assumable loan isn’t an option (buyers are getting better rates on new builds). A traditional sale means pricing very low, sitting 30–120 days, and still bringing money to closing.

I’m separating, need to move, and I’m running out of options.

My main questions: • Are short sales worth it, or is the paperwork/approval process truly terrible? • Is it smarter to rent and cover the monthly loss? • Any other realistic options I might be missing?

Looking for advice from people familiar with Phoenix/Arizona real estate or anyone who’s dealt with this situation.